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UPDATE 2-Argentina's Fernandez balms creditors with 'no haircut' talk

Adam Jourdan and Rodrigo Campos

(Adds detail on bonds prices)

BUENOS AIRES/NEW YORK, Sept 27 (Reuters) - Argentina's presidential front-runner Alberto Fernandez said that if elected next month, he would aim to avoid haircuts on bond payments and seek a moderate "Uruguay-style" debt restructuring, music to the ears of the country's creditors.

Investors are closely watching Fernandez's comments on debt after the South American nation was forced to announce plans to renegotiate around $100 billion in bonds after a sharp market crash in August pushed the country toward default.

The Peronist candidate, who soundly beat market-friendly incumbent Mauricio Macri in an August primary, is the distant favorite to win the Oct. 27 general election. How his administration will handle the debt crisis is one of the key questions for the country and its local and global backers.

"Indebtedness it the biggest issues Argentina faces today," Fernandez said on Twitter late on Thursday, aiming criticism at Macri's administration for taking on too much debt. "(But) we never said we wouldn't pay or that there would be a haircut."

He added that the country - in recession for much of the last year - needed to return to growth and to bolster exports to be able to meet its obligations.

"We will pay the debts by growing and exporting... The only way is to export. The other channel has been exhausted, which is to borrow," he said, adding that the country needed time to "defer" its debts to ensure it could pay them in full.

In separate comments at an event in Cordoba, he said Argentina should be able to replicate the model of neighboring Uruguay, which successfully undertook voluntary debt renegotiations in 2003 and is widely seen as a positive model.

Credit Suisse said in a note on Friday that Fernandez's comments were good news for the country's creditors.

The country's over-the-counter bonds were up an average of 1% by early afternoon local time, traders said.

Argentina's century bond traded up nearly one cent at 43.15 cents on the dollar according to MarketAxess data, while the January 2028 benchmark rose more than a cent to trade at 41.15 cents, both on small volume.

"We think that Fernandez's remarks regarding paying debt without a haircut, along with his track record, suggest that he could pursue a moderate economic policy course if elected," the investment bank said.

The bank added, though, that how Fernandez would achieve his goals of spurring growth while maintaining fiscal discipline under a $57 billion credit facility struck with the International Monetary Fund last year remained "unclear."

Roger Horn, senior emerging market strategist at SMBC Nikko Securities America in New York, said most investors expected some sort of losses, so they would welcome Fernandez' comments. Ratings agencies like Fitch and Moody's have also factored in write-downs on local and dollar debt.

"Hearing Fernandez refer to a Uruguay-style re-profiling is a very positive thing," Horn told Reuters. "It at least shows a market-friendly intention." (Reporting by Adam Jourdan Editing by Nick Zieminski)